AMSTERDAM, Aug 5 (Reuters) - Semiconductor industry

group SEMI Europe called on the European Union on Monday to

place as few restrictions as possible on outbound investment in

foreign computer chip technology by companies based in the bloc.

Proposals to screen outbound investment - European capital

being invested in foreign semiconductor, AI and biotechnology

companies - are being considered, though no EU decision is

expected before 2025.

The U.S. has issued draft rules for banning some such

investments in China that could threaten U.S. national security,

part of a broader push to prevent U.S. know-how from helping the

Chinese to develop sophisticated technology and dominate global

markets.

"European semiconductor companies must be as free as

possible in their investment decisions or otherwise risk losing

their agility and relevance," SEMI Europe said in a paper

outlining its recommendations.

It said policies under consideration by the EU appear to be

overly broad and if adopted could force companies to disclose

sensitive business information, adding that restrictions on

cross-border research cooperation would be misplaced.

"We encourage the European Commission to further address

these aspects and to not infringe on the ability of European

multinational companies to carry out the necessary investments

to sustain their operations," it said.

SEMI Europe represents about 300 Europe-based semiconductor

firms and institutions, including companies such as

ASML, ASM, Infineon,

STMicroelectronics, NXP, and research centres

such as imec, CEA-Leti and Fraunhofer.

Alongside the proposals for outbound investment screening,

the EU has also been moving towards a law that screens inbound

investments of foreign capital that might pose a security risk,

such as purchases of European ports, nuclear plants and

sensitive technologies.